Non-Judicial-Process
- The Notice of Default (NOD) starts the non-judicial foreclosure process. After receiving written instructions from lender(s), Del Toro Loan Servicing Inc., as the Servicing Agent for the lender(s), forwards a Declaration of Default and an Instruction to the foreclosure service to proceed with the NOD. Del Toro, or our agent, will then sign and record the NOD in the Office of the County Recorder of the appropriate county. A copy of the NOD is mailed to all parties entitled to its receipt. The Trustee will order a Trustee's Sale Guarantee (TSG) from a title company. The TSG assures the priority of each lien or encumbrance recorded against the property and provides the mailing information for the parties entitled to receive the NOD. You should review this document very closely and advise of any concerns.
- There is now a Three (3) Month Reinstatement Period. This is the minimum period, required by law, to wait before a Notice of Sale can be published and recorded. Throughout the foreclosure process, up until five (5) days prior to the Trustee's Sale date, or postponed sale date, Del Toro will attempt to collect, on the lender(s) behalf, all sums to fully reinstate the loan. Del Toro will, when retained, endeavor to negotiate, on behalf of the lender(s), a modification or forbearance agreement.
- After the 90 day waiting period the Notice of Trustee's Sale can be recorded (except in Arizona). This will indicate the place, date and time of the sale. This is to be published in a local newspaper. Twenty-one (21) days thereafter the property may be eligible to be sold at public auction to the highest bidder. The borrower has the right to reinstate the loan up until five (5) days prior to the published sale date, or postponed sale date. In the event the NOD was filed due to a balloon payment and/or maturity date, the lender(s) may require the loan be paid in full at any time during the foreclosure. Otherwise, in the five (5) days preceding the sale or postponed sale, the lender(s) may accept reinstatement, or require that the loan be paid in full.
- At the sale, the property is typically sold in a public forum along with other properties being auctioned by the Trustee.
Bidding Definitions
Full Credit Bid: The lender(s)' opening bid for the property (also known as the "Credit Bid") may be the total amount due on the loan, including principal, accrued interest, late charges, legal fees, foreclosure fees, advances, interest on advances, etc. (referred to as a full credit bid).
Under Bidding. The opening bid requested by the lender(s) may be less than the total amount due. These circumstances often require the advice of an attorney, an accountant or other professional. Del Toro will not give bidding advice. Specific bidding instructions to the Trustee are required if under bidding is elected by the lender(s).
While full credit bidding may not be appropriate, unless otherwise instructed in writing, no later than three (2) days prior to the sale date, or postponed sale date, Del Toro will direct the Trustee to proceed with a bid usually in the amount of the unpaid principal balance of the loan, directing the Trustee to increase the Lenders' bid to the unpaid debt if a third party is bidding at the sale. The property is sold to the highest bidder. If no one bids at the sale, the property is sold to the foreclosing lender(s) for the opening bid, whatever it may be. The Trustee will then convey title to a successful bidder or the lender by signing and recording a Trustee's Deed Upon Sale.
Del Toro’s servicing agreement usually allows for us to act as custodian of REO property.